12/19/07 Kanjorski Announces Almost $34 Million For 8 Area Hospitals
FOR IMMEDIATE RELEASE                              
Dec. 19, 2007                                            
Contact: Abigail McDonough
202-225-6511

KANJORSKI ANNOUNCES ALMOST $34 MILLION FOR 8 AREA HOSPITALS

Kanjorski Successfully Worked to Include Wage Index Reclassification in Medicare Bill

WASHINGTON - Congressman Paul E. Kanjorski (PA-11) successfully advocated to include the wage reclassification index in S. 2499, the Medicare, Medicaid, and SCHIP Extension Act.  The legislation passed today in the House of Representatives by a vote of 411 to 3.  This bill extends Section 508 of the Medicare Modernization Act until September 30, 2008, allowing hospitals to remain eligible for wage index reclassification that were otherwise unable to qualify.  As a result, eight hospitals in Pennsylvania's 11th Congressional district will continue to receive the full Medicare reimbursements that they deserve totaling almost $34 million.  As a top priority for the Congressman, he persistently worked with Senator Arlen Specter(R-PA) and Senator Bob Casey (D-PA) to extend the reclassification and include it in this bill.

"The hospitals in Northeastern Pennsylvania should receive the fair Medicare payments that they deserve.  To ensure that they are not short changed, I have consistently reached out to the appropriate Members and staff to include the extension in this bill," stated Congressman Kanjorski.  "While more work exists to extend the wage index reclassification for a longer period of time, this legislation will continue to ensure that area hospitals receive additional funding to improve their fiscal positions, retain and compensate qualified medical personnel, and improve patient care."

The wage index reclassification recently expired on September 30, 2007.  To make up for the past three month gap in reimbursements, this legislation will retroactively compensate hospitals, while also extending the reclassification until September 30, 2008.  

In our current healthcare system, Medicare reimburses hospitals for patients covered by the program.  Unfortunately, the amount of reimbursement that hospitals receive does not fully reflect the relative costs of wages and salaries for workers at the eight hospitals in the Congressman's district.  As a result, these hospitals fail to receive the Medicare reimbursements that they deserve.  

Section 508 aims to deal with the shortcomings in calculating the Medicare wage index and the growing unpredictability in wage indexes across the country.  The wage index is determined by the Metropolitan Statistical Area in which a hospital is located, though it often does not accurately capture the labor market in a particular area.  Section 508 has allowed these eight hospitals to reclassify to a different Metropolitan Statistical Area to increase their annual Medicare reimbursements by millions of dollars.  

In addition to extending the wage classification index, the legislation will also suspend the 10% cut in Medicare payments to doctors for six months until June 1, 2008.  Rather, the doctors will receive a 0.5% increase in payments during this time period.  The bill will also extend the State Children's Health Insurance Program (SCHIP) through March 31, 2009, providing sufficient funding to States to maintain their current enrollments through that date.

In August 2007, the House successfully passed legislation to extend the wage reclassification index for the next two years, securing over $68 million for the eight hospitals in Pennsylvania's 11th Congressional District affected by these costs.  At that time, the Senate was unable to pass the bill.

Congressman Kanjorski expressed his appreciation for the hard work of Senators Specter and Casey to help secure the current Medicare wage index reclassification in the Senate.

"This was truly a team effort to serve the people of Northeastern Pennsylvania.  I look forward to working with our Senators and Members of the Pennsylvania delegation to find a permanent solution," said Congressman Kanjorski.

The Senate passed S. 2499 on a voice vote on Tuesday evening.  The bill will now to go the President for his signature.


Click Here to read a list of the eight hospitals in Pennsylvania's 11th Congressional district affected by the Medicare wage index reclassification, which also identifies the reimbursements they will receive until September 30, 2008.